Missing in recent debate: the notion of raising taxes

POLITICAL NOTEBOOK

June 22, 2008|By LARRY CARSON

Requests for more public facilities was a theme for the County Council last week, at a public hearing and at a joint meeting with the school board. But one vital - and politically touchy - element was missing from the debate.

No one among the Elkridge residents who said they want a larger library, fire station, community center and more new schools, and no one among the school officials who need more for renovations and maintenance, suggested a way to get the money.

The notion of raising taxes, the traditional way for elected officials to fund government, never came up, though economist Anirban Basu told council members that speeding development along the U.S. 1 corridor could help produce more tax revenue.

During the council's hearing, west Columbia Democrat Mary Kay Sigaty, and council Chairman Courtney Watson, an Ellicott City Democrat who also represents Elkridge, did briefly debate that.

"Columbia is a special taxing district," Sigaty pointed out. "We pay a significant additional lien on our properties" for amenities.

Those fees provide about $50 million a year to the Columbia Association, which uses them to build and maintain community recreational and meeting facilities.

Watson noted that those fees don't pay for Columbia's schools, roads or libraries.

"We have to catch up on amenities." Watson said.

Sigaty replied that the town's developer donated the land for those facilities. The county is to start a $57 million renovation of Mount Hebron High in Ellicott City next fiscal year, along with a new, much larger library there and a large community center and park in North Laurel in the U.S. 1 corridor.

In Howard County, only one elected official - former County Executive James N. Robey - has been willing to ask for higher taxes in recent years.

Five years ago, after the last recession forced job freezes and budget cutting in county government, Robey pushed through a 30 percent increase in local income taxes - a politically risky move that drew heavy criticism at the time. But when this fiscal year ends June 30, Howard expects to see a $13.7 million surplus, while Montgomery and Prince George's counties are struggling with huge revenue shortfalls.

Also in 2003, with the economy strong and housing prices rising, Robey asked the county's General Assembly contingent for permission to increase real estate transfer taxes by one-half of 1 percent - money that could be used to borrow more than $215 million to build new schools and renovate old ones. That in turn could have freed other capital budget money for faster development of things such as libraries, community centers and fire stations.

Robey got very little public support from other elected officials. And state legislators, lobbied heavily by county real estate brokers, denied Robey's request, suggesting that the county raise the property tax rate instead.

Despite Robey's bold moves on taxes, he managed to unseat popular incumbent state Sen. Sandra B. Schrader to win a General Assembly seat in 2006 after serving two terms as county executive.

Now, with state finances in flux and after having raised a variety of state taxes last year, local legislators, including Robey, are even more skittish on taxes.

"I'm interested in discussing their needs," Robey said last week about the county. "I don't have the stomach for any more tax increases."

Loophole

Del. Elizabeth Bobo is planning to join other reformers for a renewed push in the 2009 General Assembly to close a loophole in state campaign finance law that allows business owners to avoid limits on donations.

Maryland law permits contributions from individuals up to $10,000 in a four-year election cycle, with no more than $4,000 going to one candidate. But developers often get around those limits by creating a series of separate limited-liability companies and donating money through each.

Noting recent publicity and "growing public awareness" about the loophole, Bobo told supporters in an e-mail that "we may be able to get the bill all the way through during the 2009 legislative session," despite years of futile effort.

Common Cause Maryland, studied the matter and issued a report in 2006 that led to an investigation by Maryland's state prosecutor Robert A. Rohrbaugh of donations by six vice presidents of St. John Properties Inc., a firm owned by Edward St. John.

Rohrbaugh announced June 13 that St. John agreed to pay $55,000 in fines for civil violations of election laws because he encouraged his executives to make political donations and reimbursed them later with year-end bonuses, which is illegal. He agreed to pay another $55,000 to College Bound, a scholarship fund for students from poor families. St. John also disclosed that limited liability companies affiliated with his firm made $300,000 in contributions over a four-year cycle.

"That's the kind of thing this invites," said Ryan O'Donnell, executive director of Common Cause, Maryland.

O'Donnell said the group is busy updating the 2006 report, which found that $6 million dollars was funneled to candidates in the previous three years using the loophole.